The European Union’s response to the US legislation aimed at curbing inflation could trigger a trade war, German publication Die Welt assumes.
According to Tobias Kaiser, a columnist for Die Welt, the retaliatory measures of European countries against the US Inflation Reduction Act signed in August 2022 threatens to unleash a trade war.
Earlier, during the EU summit, top European policymakers discussed the bloc’s plan to fight back against the large-scale industrial and political attack of US President Joe Biden.
If the supporters of the “hard line”, in particular France, win, this could herald a new transatlantic subsidy race and rekindle trade tensions between Europe and the United States, the columnist estimates. Kaiser believes that the implementation of these measures will require considerable financing and entail a further rise in the total debt of the European Union.
In addition, the euro bloc is considering responding with a "buy European act" and government purchases. Such protectionist steps could embroil the EU in a trade war with the United States, Kaiser pointed out.
